Magyar Nemzeti Bank

December 15, 2015

The Hungarian base rate was left at 1.35%, its level since the last of five 15-basis point cuts engineered at consecutive meetings between March and July of this year. A released statement observes continuing spare capacity, inflation that remains substantially below the 3% target, historically low expected inflation and weaker-than-desired growth, and officials predict that inflation will not return to target until the end of the current forecast horizon, So,

the Monetary Council wishes to achieve the inflation target in a sustainable way by holding the base rate unchanged for an extended period and by using unconventional, targeted monetary policy instruments, as these contribute efficiently to the further loosening in monetary conditions, particularly to the decline in long-term yields. The Council examines thoroughly the range of potentially applicable tools.

Copyright 2015, Larry Greenberg.  All rights reserved.  No secondary distribution without express permission.

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